China Morning Snapshot – 17 April 2019

The Dalian Commodity Exchange has almost shown no response to the positive headlines that read stronger than expected China GDP growth in the first quarter of the year. The trading activities remain very sluggish.   

Details on the spot and futures prices are shown in the following table:

Total inventories at Sinopec and CNPC’s warehouses digested 10,000 tons day-on-day to 920,000 tons as on 17 April 2019. 

Apparently, Chinese players have every reason to raise concern about the slow inventories digestion rate. On 17 April last year, the total inventories had already digested to the level of 840,000 tons from the 1,080,000 tons level after Lunar New Year, according to CommoPlast records and steadily going lower in the subsequent months. This year, there has not been any breakthrough despite reports that industrial production surged 8.5% in March from last year. 

While retreating to the local ground, where buyers have more negotiation power, many are also waiting to see the sustainability of the firming import market given the lack of support from local sentiment.